6 features to look for choosing a credit card

Whether you’re looking for your first credit card, or you’re looking for a replacement credit card, it can be overwhelming to know what to apply for with all the different options out there. Although your options may be limited if you have poor credit, the following are features you’ll want to keep an eye out for when choosing a credit card:

Reasonable interest rate

The lower your interest rate will be, the less you’ll pay on the amount you borrow, so it’s always a good idea to look for a credit card with a reasonable interest rate.

Low fees

Cash advances, balance transfers, and other features will sometimes cost you a little extra, so try to find a credit card product that has low fees for these services. Shop around and compare different credit card products, and move on from the ones that impose very high charges. It’s one thing if you don’t plan on using certain features very often (if at all), but for the ones you do, you want to make sure you’re not paying more than you need to. For instance, if you travel internationally or you’re planning to, you may want to opt for a credit card that doesn’t impose foreign transaction fees.

No yearly fees

Some credit cards impose an annual fee, which will be a fixed amount that you must pay every year, regardless of whether you even used the credit card. Annual fees will vary depending on the credit card, but typically range somewhere between $15 and $500. If the credit card offers a lot of great features, such as a good rewards program, you may need to pay an annual fee. But if the fee is very high or the credit card doesn’t offer any perks that are worth paying extra for, shop around for something else.

Introductory offers

Several credit card products will come with some enticing introductory offers that are valid for a limited time, such as a very low interest rate, or even a zero-percent interest rate. This is a great feature to look for in your next credit card, and often isn’t too hard to find, but you’ll want to carefully look through the terms and conditions before you apply to find out how high the interest will be, once the introductory period is up. If the interest rate will still be reasonable, you may want to go ahead and apply. But if it will be very high and you might still be carrying a balance by the time the introductory period is over, you may want to avoid that particular credit card.

Free credit score information

Some credit card programs make it easy and convenient for their customers to monitor their credit scores and will receive this information free of charge with their monthly statements. This is a good perk to have, and is one feature you’ll want to look for when you’re comparing credit card offers.

Rewards program

There are several credit card programs that offer points for purchases, and when you save up enough points, they can be redeemed for travel, merchandise, and other rewards. You may or may not want a credit card that offers a rewards program, as sometimes these can come with high interest rates and annual fees. However, if annual fees are low and you plan on paying off your balance in full each month, it is certainly a credit card program worth considering.

After you’ve narrowed down your options to just a few, compare the final choices and make a decision based on what credit card offers the best benefits and terms. Because all applications for credit are hard inquiries, which affect your score, you want to only apply for one credit card and refrain from applying for anything else for a while.

When making your selection, you’ll also want to make sure you’re not applying for a credit card that has strict acceptance criteria if your credit score is poor. Remember that receiving pre-approved offers in the mail from a credit card doesn’t mean you’ll automatically get accepted. Read through the application and find out what their requirements are; most will include minimum credit scores and other criteria. If it’s unclear, call up the credit card company and ask.

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Nothing above is meant to provide financial, tax, or legal advice. You should meet with appropriate professionals for such services.